GM Supports Patronage Refund System


By Bini Reilly,
General Manager

Upon arriving at GreenStar, I learned that a patronage refund system was soon to be voted on by the membership. I believe member-owners should vote in support of this bylaws change. Membership in GreenStar means you are a member-owner in this community-based enterprise. As such, you should want to ensure the continued and future viability of the Co-op.  It is the right thing, as a member-owner, not to take monies out of the Co-op until you know that the Co-op is financially stable.

Every month, GreenLeaf prints the seven Cooperative Principles, to which GreenStar subscribes (see page 4). The principle that describes how a cooperative compensates member-owners is Principle 3: Member Economic Participation, as defined by the International Co-operative Alliance:

Members contribute equitably to, and democratically control, the capital of their cooperative. At least part of that capital is usually the common property of the cooperative. Members usually receive limited compensation, if any, on capital subscribed as a condition of membership. Members allocate surpluses for any or all of the following purposes: developing their cooperative, possibly by setting up reserves, part of which at least would be indivisible; benefiting members in proportion to their transactions with the cooperative; and supporting other activities approved by the membership.

 All member-owners have the joint responsibility to ensure GreenStar’s success. As a member-owner, you should be prepared to support the store in good and challenging economic times. Thus, prudent and “best practices” would indicate that profits are taken out of the enterprise only once financial profitability has been determined. The Co-op should have funds to reinvest in its infrastructure: physical plant, equipment and staff, as well as putting aside funds for a “rainy day.” Many of you have spoken to me about other opportunities for GreenStar in this and other communities. These opportunities will require financing, which means GreenStar needs to set aside additional funds.

When you become a member-owner of GreenStar, you are investing in the local economy.   Co-ops are community-based businesses that need to remain profitable to continue to serve their communities. I have worked with a number of co-ops over the years and most now use a patronage refund system. The Wedge Co-op in Minneapolis has had a patronage refund system since 1990, and has returned $2.5 million to its members.

As part of the proposed patronage refund system, GreenStar staff has looked and will continue to look at other ways to provide added value to member-owners. In October, 10% on the 10th began—every month GreenStar will offer non-working member-owners 10 percent off on all non-sale items. Member-only specials will be starting in November. New members receive member-only coupons.

Co-ops are democratically-controlled organizations. There are very few businesses that I know of that not only allow, but expect, your input when planning for their future. I want to see GreenStar continue to be here for years to come, so I encourage member-owners to support this bylaws change.


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General Manager

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